Economic profits, economic losses and opportunity costs
Macroeconomics
After natural disasters, such as hurricanes, some commentators point to ‘bright-side’. It is, for example, often pointed out that natural disasters reason GDP for a region to spike upward during the post disaster cleanup. As someone with an understanding of opportunity costs, if you were asked, what would be your economic examine of effects of the natural disaster? Using your knowledge of GDP, describe why GDP might increase during the cleanup. Using your understanding of economic profits, economic losses and opportunity cost, does this mean that the area affected by the natural disaster has experienced economic growth? Determine the seen effects and unseen effects?
